EPIGRAL - Epigral

📊 NSE: EPIGRAL 🏢 Chemicals 📅 Last Updated: 12/13/2025 21:55

💰 Financial Performance

Revenue Growth by Segment

Revenue from the Specialty and Derivative segment grew significantly, increasing its revenue share to 54% in the first nine months of FY2025 compared to 42% in the previous year. Overall revenue for FY2024-25 reached INR 2,550.13 Cr, a 32.2% increase from INR 1,929.19 Cr in FY2023-24. However, H1 FY2026 saw a 6% YoY revenue decline to INR 1,204 Cr due to lower realizations.

Geographic Revenue Split

Not disclosed in available documents; however, the company focuses on import substitution for the domestic Indian market for products like ECH and CPVC where domestic capacity is low.

Profitability Margins

Profit After Tax (PAT) for FY2024-25 was INR 356.70 Cr, representing a 14% net margin, up from INR 195.79 Cr (10.1% margin) in FY2023-24. H1 FY2026 PAT stood at INR 212 Cr (18% margin), though this was aided by a one-time deferred tax credit of INR 81 Cr.

EBITDA Margin

EBITDA margin was 28.5% in FY2024-25 (INR 725.93 Cr) compared to 25.3% in FY2023-24. In Q2 FY2026, the margin compressed to 23% (INR 132 Cr) from 29% in Q2 FY2025 due to a drop in product realizations while raw material costs remained stagnant.

Capital Expenditure

The company is investing INR 780 Cr to double capacities for CPVC (to 150,000 TPA) and ECH (to 100,000 TPA). In H1 FY2026, actual capex spent was INR 236 Cr.

Credit Rating & Borrowing

Long-term credit rating is CRISIL AA-/Positive (upgraded from Stable) and short-term rating is CRISIL A1+. Adjusted interest coverage is healthy at 6-9 times for the FY2024-2027 period.

⚙️ Operational Drivers

Raw Materials

Key raw materials include Glycerol (for ECH production), Salt (for Caustic Soda), and Chlorine. Raw material costs remained high in Q2 FY2026, contributing to a 19% drop in EBITDA as realizations fell.

Capacity Expansion

Current CPVC capacity is 75,000 TPA, expanding to 150,000 TPA; ECH is 50,000 TPA, expanding to 100,000 TPA by H1 FY2027. The Chlorotoluene value chain plant was commissioned in March 2025.

Raw Material Costs

Raw material costs as a percentage of revenue increased in Q2 FY2026 as product prices dropped while input costs stayed flat. The company uses a glycerol-based process for ECH to manage costs and sustainability.

Manufacturing Efficiency

Overall plant utilization stood at 78% in Q2 FY2026, down from 83% in Q2 FY2025. H1 FY2026 utilization was 75% compared to 83% in H1 FY2025.

📈 Strategic Growth

Expected Growth Rate

12-15%

Growth Strategy

Growth will be driven by doubling CPVC and ECH capacities by H1 FY2027 and ramping up the new Chlorotoluene value chain, which is expected to contribute significantly from FY2027. The strategy focuses on import substitution for high-demand derivatives and increasing the specialty revenue share to 70%.

Products & Services

Caustic Soda, Chlorine, Hydrogen, Chloromethanes (CMS), Chlorinated Polyvinyl Chloride (CPVC), Epichlorohydrin (ECH), and Chlorotoluene derivatives.

Brand Portfolio

Epigral (formerly Meghmani Finechem).

New Products/Services

Chlorotoluene value chain and expanded CPVC/ECH capacities are expected to drive double-digit revenue growth over the medium term.

Market Expansion

Focusing on downstream chlorine and hydrogen derivatives to diversify away from the competitive Chlor-Alkali market.

Market Share & Ranking

The company is a major player in the Indian Chlor-Alkali industry, competing with GACL, DCM Shriram, and Grasim.

Strategic Alliances

Part of the Ahmedabad-based Meghmani Group; originally a subsidiary of Meghmani Organics Ltd.

🌍 External Factors

Industry Trends

The industry is shifting toward integrated operations and downstream derivatives. Epigral is positioning itself by moving from a 30% specialty mix in FY2023 to a target of 70% to insulate against commodity price cycles.

Competitive Landscape

Intensely competitive Chlor-Alkali market dominated by large players like Gujarat Alkalis and Chemicals Ltd (GACL) and Grasim Industries.

Competitive Moat

Moat is built on integrated operations (captive chlorine/hydrogen use) and a low-cost production model. Sustainability is supported by being the first in India to use glycerol-based ECH production.

Macro Economic Sensitivity

Demand is sensitive to slowdowns in key end-user industries (textiles, alumina, paper) which can lead to destocking and lower realizations.

Consumer Behavior

Increased domestic demand for CPVC (pipes) and ECH (epoxy resins) is driving the shift toward these import-substitute products.

Geopolitical Risks

Exposure to global supply chain shifts and regulatory changes in environmental laws.

⚖️ Regulatory & Governance

Industry Regulations

Subject to environmental regulations on greenhouse gases and hazardous chemical management. Compliance with Extended Producer Responsibility (EPR) for packaging waste is maintained.

Environmental Compliance

Invested in an 18.34 MW wind-solar hybrid plant and uses waste-minimizing technologies to comply with emission and wastewater disposal norms.

Taxation Policy Impact

The company shifted to a new tax rate of 25.17% in FY2026, which resulted in a one-time reduction of deferred tax liability by INR 81 Cr.

⚠️ Risk Analysis

Key Uncertainties

Vulnerability of operating margins to fluctuations in Caustic Soda prices and potential delays in the commissioning of the INR 780 Cr CPVC/ECH expansion projects.